An actual GOOD article on retiring early

[slepyhed]

Here is an article on how to retire early:

http://finance.yahoo.com/retirement/...-you-will-need

They hit on the important points: you need a large nest egg, you'll have to save a large proportion of your income, invest wisely, etc.

The "start your own business" advice seems silly, though. The entrepenuer doesn't plan on retiring anyway. I can't reconcile throwing yourself heart-and-soul into work (even if its your own business) if your goal is to stop working all together. No balance there. And what if you get hit by a bus tomorrow?

Never-the-less, its a pretty good article.

-Mike M.

[winnie]

Well, I'm not sure it is such a great article b/c it uses Shawn Larson as its chief example. He LBYM and saves more than half of his salary -- seems exemplary. But then you learn his salary is $180k. Woudn't be hard for many to get to FIRE earning that kind of money....he's LBYM on $90K! I'm happy for him but unhappy that the article holds him up as an example for everyone else on how to get to FIRE....

[Sam]

Ditto! Plus the guy will have a 30K annual pension, and plan to splurge only occasionally, like a 75K expedition.

It's LBYM, but the B might not stand for below.

[youbet]

The advise and examples I'm interested in involve average earners whose FIRE status depends on their personal savings and investments. Reading about folks with generous COLA'd pensions or folks who saved half of an enormous salary, received an inheritance, etc., just doesn't seem like the real deal. I mean, those are surely fortunate situations, but not a very interesting read. Now someone who was able to put together FIRE while earning average bux, no pension and raising a family.........that's interesting.

[danm]

That's funny. Shawn posted all of his details here a month or two ago, and his name, occupation and everything. Several people suggested he take down all that personal information.

Looks like the article author saw that posting too, and then looked him up to profile.

[TromboneAl]

Quote:

The "start your own business" advice seems silly, though. The entrepenuer doesn't plan on retiring anyway. I can't reconcile throwing yourself heart-and-soul into work (even if its your own business) if your goal is to stop working all together.

That's exactimundo what I did.

Thanks for the article!

[Jay_Gatsby]

I agree that there is a great deal of pie-in-the-sky thinking/examples in the article. Someone who is earning $180k as a single guy shouldn't have any problem retiring in 3 years. Yet someone with a full family and its attendant costs probably can't imagine the idea of retiring at that age, especially on a household income of ~$100k per year. This is especially the case for people who wait until their early-30s to get married (which is becoming very common today).

[Spanky]

Quote:

Originally Posted by winnie Well, I'm not sure it is such a great article b/c it uses Shawn Larson as its chief example. He LBYM and saves more than half of his salary -- seems exemplary. But then you learn his salary is $180k. Woudn't be hard for many to get to FIRE earning that kind of money....he's LBYM on $90K! I'm happy for him but unhappy that the article holds him up as an example for everyone else on how to get to FIRE....

He must be a top scientist since most do not command a $180K salary (http://www.jupiterscientific.org/sci...esalaries.html). Anyway, I do not think he can save $90K since his net (after tax) is probably about $90K.

[FinanceDude]

Quote:

Originally Posted by youbet The advise and examples I'm interested in involve average earners whose FIRE status depends on their personal savings and investments. Reading about folks with generous COLA'd pensions or folks who saved half of an enormous salary, received an inheritance, etc., just doesn't seem like the real deal. I mean, those are surely fortunate situations, but not a very interesting read. Now someone who was able to put together FIRE while earning average bux, no pension and raising a family.........that's interesting.

Could not AGREE MORE...........who would write such a book.........other than someone on here??

I would DEFINITELY READ about the real life story of what you suggest.........

[perinova]

Quote:

Originally Posted by slepyhed The "start your own business" advice seems silly, though. The entrepenuer doesn't plan on retiring anyway. I can't reconcile throwing yourself heart-and-soul into work (even if its your own business) if your goal is to stop working all together. No balance there. And what if you get hit by a bus tomorrow?

It doesn't have to be that way. It might be for most people starting their own business; for others (you!) it could be just a tool to retire early.

I understood early in the business process that I could spend all day finding new markets hire secretary, other employees and grow the business... But that would be at a personal cost of less time for hobbies, family, vacation... Also one needs to be careful about what remain after expenses are taken out.

In short - for the moment I am keeping the consulting business low for the above mentioned reasons (and maybe I am not ready psychologically and didn't find the right partners to grow the business with). The business started by necessity (didn't want to be an employee after being laid off, wanted to stay put rather than relocating). It has been good financially but as you can see by the fact I am on this board: I will be ready to pull the plug when it will be possible. (Well I hope Maybe I will chicken out )

[teejayevans]

Quote:

Originally Posted by Jay_Gatsby I agree that there is a great deal of pie-in-the-sky thinking/examples in the article. Someone who is earning $180k as a single guy shouldn't have any problem retiring in 3 years.

Reminds me of the old joke; How do you become a millionaire?, first get a million dollars.

[Caroline]

Quote:

Could not AGREE MORE...........who would write such a book.........other than someone on here?? I would DEFINITELY READ about the real life story of what you suggest.........

I bet a lot of folks would read that.

Ok, so here's the plan. Everyone here who wants to can write up their own FIRE story -- limit X-thousand words, whatever. Maybe create some rules to keep the right tail of the income / inheritance distribution from being over-represented, so the average folks among us can tell their tales.

Someone adds the introduction and edits the stories (I can see the fur flying now), another one flogs it to publishers, and everyone divides proceeds after a generous cut to Dory, who started the whole thing.

Uh oh... I just realized the irony! This plan looks a lot like wo... wo... WORK! ;-D

[LOL!]

Quote:

Originally Posted by winnie Well, I'm not sure it is such a great article b/c it uses Shawn Larson as its chief example. He LBYM and saves more than half of his salary -- seems exemplary. But then you learn his salary is $180k. Woudn't be hard for many to get to FIRE earning that kind of money....he's LBYM on $90K! I'm happy for him but unhappy that the article holds him up as an example for everyone else on how to get to FIRE....

Actually, based on polls on this forum, Shawn has a pretty typical income and expenses to most of the folks answering polls around here.
Full disclosure: I'm a scientist. Science can be lucrative.

Quote:

Originally Posted by teejayevans Reminds me of the old joke; How do you become a millionaire?, first get a million dollars.

I thought is was, "How do a make a million in the stock market?"

Start with two million.

[slepyhed]

I agree that the earnings of the folks cited in the article are atypical. But the responses I see here remind me of a story...

When I first entered the workforce, I had a pretty good salary as an entry-level engineer. It was $33k per year in 1995. Plenty of money for a single guy with no mortgage and no student loans. Ahhh, those were the days.

However, I wasn't rich. The very thought of achieving financial independence never crossed my mind. Sure, maybe if I made $50k per year, I'd be able to sock it away bigtime.

Well, time passed and eventually my salary climbed to $50k per year. Except there was no way I could sock tons of money away, or so I thought at first. I thought about it for several months before I reached the conclusion that unless I took action, my spending would always match my income. It just doesn't matter how much you make, there's always plenty of ways to spend it.

So I don't think its valid to say, "If I made that kind of money, I'd be able to save huge amounts too!" No one just falls out of the sky into a certain job that pays a certain salary. They work their way into it. If they don't control their spending, it will easily ramp up right along with their salary.

It was a valuable revelation to me, anyways.

-Mike M.

[unclemick]

My My - how times change - 1966 went from a hungry student to a big bucks engineer $8k. UW in Seattle was probably the most expensive state school(I ran approx $1500/yr all in expenses).

300k financial plus rental duplex in 1993 at age 49 'retirement' counting her money also. The principles don't change much:

1. save as early as possible.
2. Dollar cost average
3. Investing costs matter - be cheap
4. Diversify.

heh heh heh heh - time in the market was my biggest winner. Power of compounding - all that rot.

[SingleMomDreamer]

Let's call it like it is: The article SUCKED the big one. Made me depressed that I am only a few years away from this guy's age and wasn't even close to his numbers. Pension, huh? Retiree health benefits? Yea, right. Not in my picture. Besides, the amount he "needs" in his retirement is based on x% of salary--doesn't even consider actual expenses. If this is the "typical" early retiree then I absolutely can't relate.

[donheff]

I know a lot of people making far more than that guy who will never be able to ER. It is easy to burn up a small fortune with expensive houses, vacations, cars, clothes, etc. Add in private schools and colleges and many of those big earners would not believe that the typical story on this board even falls in the realm of the possible.